Bob Schwartz

September 27, 2012

Soylent Green, My Friend, Is People


Mother Jones has already changed the trajectory of the Presidential campaign with the “47%” video. It’s latest video find may not have the same effect, but it is still revealing.

It comes from a promotional Bain Capital CD-ROM from 1998. Along with other artifacts of the Bain culture at the time, it includes a video of Mitt Romney from 1985 explaining the Bain business model:

Bain Capital is an investment partnership which was formed to invest in startup companies and ongoing companies, then to take an active hand in managing them and hopefully, five to eight years later, to harvest them at a significant profit…The fund was formed on September 30th of last year. It’s been about 10 months then. It was formed with $37 million in invested cash. An additional $50 million or so of what I’ll call a call pool, which is money that we can call upon if the deals are large enough that they require more than a $2 or $3 million dollar initial investment. Why in the world did Bain and Company get involved in this kind of a business? We’re not particularly noted for having years and years of experience in financing. Three reasons. We recognized that we had the potential to develop a significant and proprietary flow of business opportunities. Secondly, we had concepts and experience which would allow us to identify potential value and hidden value in a particular investment candidate. And third, we had the consulting resources and management skills and management resources to become actively involved in the companies we invested in to help them realize their potential value.

It’s the “harvest” line that is getting the most attention, presumably because it suggests to some that the companies are viewed primarily as abstract opportunities that are optimized for profit, rather than enterprises that make particular things and where particular people work and build their lives.

Fans of sci-fi movies are burdened by seeing the “real” world through the lens of those films. So this line flashed two iconic and unforgettable scenes.

One is from The Matrix (1999), when we first see the humans being used as living batteries to power the world of the Matrix.

The other is from Soylent Green (1973). In 2022, the desperate population of overcrowded New York City is being kept alive by the nutritional drink Soylent Green. At the end, we learn the dark secret of Soylent Corporation, as screamed by Charlton Heston (spoiler alert): “Soylent Green is people!” Yes, it is processed from the oversupply of corpses.

All this probably has nothing to do with Bain Capital harvesting companies. Somehow, though, “Corporations, my friend, are people!” just got mixed up with “Soylent Green is people!”, Charleston Heston got mixed up with Clint Eastwood and Mitt Romney.

As noted in a post a few days ago, this campaign may not just be threatening to drive us—candidates and voters—mad. It may have done that already.

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September 27, 2012

Victims of the Federalist Laboratories


This morning, a pundit again tried to square the circle by explaining how Mitt Romney can be both the heroic father of Romneycare in Massachusetts and the sworn enemy of Obamacare in the U.S. It goes like this: the states are political/social/economic “laboratories” in which 50 different experiments can produce 50 different solutions. (It isn’t clear why the District of Columbia, Puerto Rico, etc., are not capable of conducting these experiments too.)

This is nonsense. Not as political theory or as Constitutional interpretation. It is nonsense because it makes no sense, or at best, tragic sense.

America’s most notorious state-by-state experiment was slavery. And if an experiment is judged by its results, slavery was in some ways an excellent economic solution for the states that tried it. No matter how much other states tried to convince them that it was flawed, those slavery laboratories kept on operating—right until the time that they were forced to close them down in a bloody war.

This is how experimental laboratories work. Different scientists race to solve essential problems. When one comes up with an effective solution, that doesn’t necessarily stop the others from continuing their work on better answers, or from criticizing competitors. But in the meantime, if the problem is critical, the solution is rolled out widely to relieve the situation, at least until something better comes along.

Let’s say that the Massachusetts laboratory developed a cure for cancer. After some clinical trials, it was deemed worthy to be given to the whole state. The benefit was positive and obvious. One of the developers went out of his way to make a high-profile public case for its success and his role in it.

But the other 49 states said: not so fast. They believed that there was a better solution to cancer, if not right around the corner, then soon. All they needed was more time, and in the meantime, they didn’t want the people of their state subjected to these wild experimental solutions.

That is a much more apt metaphor than merely talking about laboratories in general. Call it what you want—Heritagefoundationcare, Romneycare, Obamacare, Affordable Care Act—we have a proven solution. Standing in the way of it, promising to repeal it, simultaneously owning and disowning it, is unconscionable in the face of knowing that with it, people who are well can be kept well and that people who are sick can get better.

Anyone, from a Presidential candidate on down, who can look at people and tell them that they will just have to suffer a little longer while the political scientists of the 49 states tinker in their laboratories needs to look elsewhere. They need to look at themselves, and see where the real problem is.

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